When attempting to value one firm using P/E comps from a few similar firms,

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Both options B and C are reasonable methods to use. Option B suggests using the median P/E ratio to avoid any potential outliers that could skew the average. Option C suggests averaging the earnings yields, which takes into account any differences in earnings growth rates between the firms, and then inverting the average earning yield back to a P/E ratio. Both methods have their merits and can provide a more accurate valuation compared to just using a simple average. Therefore, it would be best to use a combination of both methods to obtain a more comprehensive analysis. Both option B and C are reasonable methods to use when attempting to value one firm using P/E comps from a few similar firms. Using the median P/E ratio is beneficial because it is not influenced by outliers, while averaging the earnings yields is useful as it takes into account the effect of differences in growth rates among the comparable firms. Inverting the average earnings yield back to a P/E ratio provides a more comparable metric to the P/E ratios of the comparable firms. Therefore, both options can provide a more accurate valuation of the firm being analyzed.

When Attempting to Value One Firm Using P/E Comps from a Few